Lake Lawn condos approved

DELAVAN  After months of negotiation, the Delavan City Council on Tuesday night approved an amended developer’s agreement with Lake Lawn Resort, allowing the developer to finally break ground on the first new construction of its planned $390 million renovation and expansion.

But the approval didn’t come without last-minute changes.

Lake Lawn plans five lakefront condominium buildings called the Villas at Harbor’s Edge, the Grand Delavan hotel and conference center and an indoor water park.

The proposed agreement conditionally approved by the city council July 21 called for completion of the projects by mid-2012 but allowed for changes to the timeline because of market and economic conditions, lender requirements, government approvals and “unforeseen conditions.”

But it was the words “unforeseen conditions” and the last-minute timing of the proposed change that bothered residents, who said the phrase would give the city no protection if Lake Lawn went back on its guarantee to complete the projects.

“As of today, if Lake Lawn didn’t build another building, there would be no recourse on the part of the city to recover expenditures,” said plan commission member Kevin Armstrong.

The city has committed to making $4 million in water and sewer improvements in the tax incremental finance district that includes the resort.

He said the disclaimer “turns their contractual guarantee into an intention.”

Dan Kilkenny called the last-minute move by Lake Lawn “deceptive.”

“I think they’re looking to avoid their commitment,” he said.

Sorrentino said the change she proposed was meant to address city concerns.

“We want to see this get done,” she said. “I don’t want us to be viewed as obstructionist.”

She said most construction contracts include an “unforeseen conditions” clause, covering such things as the discovery of a Native American burial mound on the site.

But to alleviate residents’ concern that the clause “opens it up to everything and anything,” Sorrentino suggested the word “property” be inserted into the phrase.

Alderman Dave Kilkenny didn’t think the provision was necessary. The original developer’s agreement approved a few years ago already addresses permitted construction delays, he said.

But Mark Schroeder, the attorney representing the city in dealings with Lake Lawn, said adding the word “property” would be a “substantial improvement” to the agreement.

He said if the agreement was going to permit some flexibility in the timeline for completion, the factors delaying construction should be things that can be measured objectively.

“I think the things removed today were subjective,” he said.

Schroeder said inserting the word “property” provides the city more protection in the event Lake Lawn does not complete the projects.

“This says we can’t have carte blanche like in the original agreement,” he said. “(Delays) have to be what’s listed—lender requirements, governmental approvals, etc.”

The city council approved, 5-1, the amended developer’s agreement to read that the timeline for completion could change because of “unforeseen property and site conditions,” among other things.

Kilkenny was the lone dissenting vote.

The council then unanimously approved final plans for the Villas at Harbor’s Edge.

Lake Lawn representatives said construction of the first two buildings will begin in September and should be completed next spring.